PODCAST TRANSCRIPT:

Ian Robertson
Joe Ferry, the home inspector lawyer himself. Thank you so much for being on, Joe.

Joe Ferry
I’m happy to be here, Ian.

Ian Robertson
You know, I gotta say, your episode with us a couple years ago is still one of our most popular episodes, and there’s few people that I respect in this industry more than you. People come and go, but you’ve been in the industry.

Joe Ferry
Yeah, I’ve been around since the cockroach, you know.

Ian Robertson
I think you’ve probably seen more home inspector legal cases than any other human on the planet.

Joe Ferry
Yeah, I’ve read more complaints, I’ve read more claims, I’ve responded. I think I’ve responded to about 4000 claims over the years, you know, 25 years times 100 and some a year. They are completely ridiculous in the main, you know. Guy does a home inspection for somebody, the classic example is I had a guy in Massachusetts did a home inspection for somebody in August. The guy had a heat pump. Now, leaving aside the issue of installing heat pumps in a climate like Massachusetts, you know, it’s just ridiculous to do that. The guy, the inspector told the guy, look, 85 degrees out, I couldn’t test the unit for its heating function, but you know, these things are temperamental, and you really need to have them serviced regularly, and you should inquire of the seller whether he’s ever had any issues with that. So this is August. The client moves in in October, and in December of that year there is an epic snowstorm from Texas, Gulf of Mexico, Gulf of America, excuse me, from the Gulf of America all the way up to Nova Scotia, blankets the country with huge snowfall, 30, 35 inches in places, and that’s the day that this guy’s heat pump decides to quit. So he goes, got a newborn in the house, he flees to his in-laws’ house until the municipality gets the streets cleared, and then on the following Monday he seeks out the HVAC guy. The HVAC guy comes out and dismantles the heat pump and tells the guy, look, this is, you know, you got a blown Johnson rod or something, and it’s dead, it’s not going to work anymore, you need to get it replaced. And then he says to the fellow, how long have you lived here? He says, I moved in October. Did you have an inspection? Yeah, of course. Well, I don’t know how the home inspector could have missed this. You know, and that’s what happens. That is how 99.9999% of claims are generated. Some professional roofer, HVAC guy, electrician, they throw the home inspector under the bus, and that is the number one culprit for causing home inspections. And the funny thing is, is that the guy, the claimant, the fellow with the heat pump, before this HVAC guy puts that thought in his mind, he doesn’t think the home inspector remotely has anything to do with this, but following getting that seed planted, he can’t get that thought out of his head, and it’s like waking up in the morning and hearing American Pie on the radio, you know, you’re running around your ear for the rest of the day, and so then you need to call me, and I generally am able to get rid of these guys.

Ian Robertson
Yeah, and you’ve taken care of stuff for a lot of inspectors that I know, and we’ve used you for nearly 20 years. I think one of the biggest fears for any new guy is hearing the horror stories of, hey, going to court, and you know someone’s going to sue you, and you’re automatically going to lose. And I hear insurance companies say that, oh, never go to court, you’re always going to lose. And over the years, you’ve taught me that in reality, there’s not a lot of meritorious claims, and most of them go away with just a letter back, like saying, hey, yeah, you got nothing going on here. You took care of, many, many years ago, you took care of another attorney, just as aggressive as could be, just making up wild stuff, and you put a kibosh on it in like 10 minutes. You even squashed something with the state for us one time, like you said, here, put this in there, put that in there. Somebody made a claim against the state, and it was against an engineer—I probably told this story before—and so the state actually came back and said, Ian’s company is in the right, and then they either fined or cited the engineer against his professional license for practicing out of his profession, so it’s funny how…

Joe Ferry
A good result.

Ian Robertson
Yeah, you did a fantastic job, and it’s funny how we worry about the boogeyman, but we’ve never met the boogeyman.

Joe Ferry
Right. Exactly. Yeah. Well, you have to understand, because I do plaintiff’s spaces too, and one of the things, my cardinal rule is, I don’t take cases that have no chance of success, and that don’t have enormous damages, you know. There’s no point. Plaintiffs’ attorneys have to make a living too, and they can’t be taking these ridiculous cases. And the guys that show up on the other side of these cases, by and large, they’re not the brightest lights in a legal profession, and so I’m, in a large number of cases, I’m educating them to the pitfalls that they’re about to go into if they pursue this, because litigation takes forever, and there’s really no happy ending for anybody in litigation, and that’s why plaintiffs’ attorneys really, really try to avoid it at all costs, and quite frankly, so do insurance companies. I mean, insurance companies are so risk-averse, it’s really pathetic. I saw a case recently where after I had done my bit, you know, the person continued, they soldiered on and filed lawsuit, and the insurance company, their attorneys did not use any other defenses that I used in my response. They won’t even try to enforce a limitation on liability clause, which is ridiculous. I mean, that’s absolutely, that’s a lay down hand in jurisdictions that enforce them, and to not plead that is ridiculous. So, I don’t know where these insurance companies are, what their business model is, but…

Ian Robertson
I think it has more to do with the actuarial or financing part of things, because…

Joe Ferry
I think so.

Ian Robertson
Yeah, because I mean there was a buddy of mine, he’s a contractor, and he got sued because there was some work that wasn’t done at a building he was hired to do work at, and he had a signed work order saying, we don’t need this work from the manager, all this paperwork, and he goes, I showed up, and they wouldn’t let me do the work, and his insurance company still paid out, and he was upset. I’m just like, they don’t care. They’re like, okay, it’s going to cost us $20,000 to work this out, or we can pay them $18,000 and be done. So, for that $2,000 margin, they’re going to just pay out.

Joe Ferry
It’s ridiculous. You’re right about the actuarial thing, though, because before I became an attorney, I was in the insurance industry, and what’s interesting to me is when you read the insurance, you know, the professional papers and whatnot, they list the major insurance companies, and there’s no insurance company that has underwriting profits. They don’t have underwriting profits at all, according to what they file, because what they’ll do is they manipulate their losses. There’s actual losses, and then they have something called IBNR. IBNR stands for “incurred but not reported.” So they always manage to have over 100% because they manipulate the IBNR, and the reason they do that is that, you know, they don’t want to have underwriting profits, they want to preserve all that money that they have at premium, because they’re investing it, and they’re investing its long-term investments in the main, and so in order to do that, because if they have an underwriting profit, they have to pay taxes on it.

Ian Robertson
So it’s almost like, the dumber version for me is, it’s almost like tax loss harvesting when you’re investing.

Joe Ferry
Exactly. That’s exactly what they’re doing. Yeah, and it’s remarkable, because you know, anybody in the industry knows that they do this, you know. Of course, nobody in the government knows that, though.

Ian Robertson
Well, but then you get down to like a guy like me or one of our listeners, and we’re just like, why did they pay out? They’re tax loss harvesting.

Joe Ferry
Exactly right. I mean, I couldn’t believe this payment. The guy wrote to me, and he said, you won’t believe what they gave this person. I said, don’t tell me. He told me anyway. $300-some thousand on the case that was really worth at most three or $4,000 and was actually worth zero. I mean, it was defensible, it was completely defensible, but they just don’t want to go to court, I don’t know. Well, they don’t pay their lawyers anything, that’s one reason.

Ian Robertson
Well, yeah, that’s true too. But therein, I guess, lies the fear, because we all walk around saying, you know, I’m just a home inspector doing my job, my position is defensible, all this other stuff, but at the end of the day, we worry about those, I’m going to call them rare cases, because I’ve been in business for 20 years. We’ve never gone to court. We’ve never had an insurance payout. We have done thousands upon thousands of inspections, but those rare cases, I think keep some home inspectors up at night.

Joe Ferry
Yeah, and I’ll tell you what, when you do get sued, it takes over your life. It’s very, very emotional, you know. Interesting to me, having been doing this for 40 years, is…I was walking downtown Philadelphia one time, and a former colleague of mine came up to me, and it happened to be a day before Thanksgiving many years ago, and he says to me—he had been a former partner of mine, we started a law firm together with another guy—and he told me he had gone to the firm that I actually started out with, a big white shoe firm in Philadelphia, and I said to him, what is your hourly rate, expecting him to say something crazy like $300 an hour, and he said $500 an hour, so I immediately went and upped my hourly rate. But then two or three days later, I met another friend of mine, real high powered female attorney, and I told her this story, and she says, Joe, you know what my rate is? I said no, what? She says, $720. Her name’s Carolyn. I said, Carolyn, who pays that? And she says, yeah, tell me about it. I have to go out and get business with this, you know, albatross around my neck of $720 an hour billing rate. Then, about two days, three days later, I ran into another attorney friend of mine in the farmer’s market. I tell him both of these stories, and he says, “Joe, you can’t try a case today that’s worth less than a million dollars. You can’t try a case that’s worth less than a million dollars, and then here are these guys on the other side of these cases that I’m handling, they think you’re going to trial. I’m like, no, are you nuts, you know, you’re going to lose money. Even if this case had merit, you would lose money trying it, you know, and it doesn’t have merit.

Ian Robertson
It’s funny, because we did a podcast not long ago on a principle that you taught me, which was basically make it too expensive to sue you. So, if somebody wants to sue you for $300,000, make it cost $500,000 to get to you. If anybody wants to go back and listen to that podcast, you’re more than welcome to, but that’s really what it comes down to is, it gets so expensive that most attorneys, in my experience, will usually just send a letter. Okay, let me charge you for an hour’s worth of time. I’ll send a letter, a lot of times I’ll send you a check for $15,000 or whatever. They’ll just, the insurance company will make it go away. Any little pushback, and they’re like, okay, at $450 an hour, do you want me to respond and do some research? It goes away pretty quickly.

Joe Ferry
You know, there’s guys that are hungry, you know, and they take these cases. I wouldn’t mind if the cases had, like, there are small cases that you can win, you know, where there’s clear liability and an actual injury, like someone breaks her arm, or you know, breaks a bone, you know, they’ll pay for that, you know, but any little thing at all, like you see a lot of soft tissue issues, like I tried a bunch of cases for Kmart, and as a defendant, and you know, if they make them try the case, they’re generally unsatisfied with the result, you know.

Ian Robertson
You know, I think one of the biggest questions that I think a lot of us have, and I mentioned this to you before, is AI, so maybe I can give you a scenario, because this is one that I have done a lot of research on, and it’s such a new part of the industry that I really wasn’t able to find an answer on. So I don’t think there really is an answer, because I don’t think it’s been, there’s enough precedence yet, but here we go. So let’s say a home inspector goes and inspects a house, and he uses AI, maybe to one extent or another, maybe he uses AI to analyze the pictures and to write down what he sees in the pictures, or uses AI to write a comment and puts in there in the comment that something wasn’t true, like it said you had one layer of asphalt shingle when you had four layers of asphalt shingle, or you know, composite or fiberglass, or whatever. Now he gets sued, and they say, well, you put in something inaccurate, and then his defense, they’re gonna be like, did you use AI? He’s like, yeah, I used AI. The AI was wrong. The only thing I could find out is number one, the AI, or the company that he used the AI through, is pretty much never liable. It’s kind of like providing somebody with a Sawzall, you can’t sue the Sawzall company when you cut off your own finger. They’re not liable. So, how much liability does that home inspector create for himself? Because what I see, by and large, is we trust AI more and more than we should, and there’s a podcast we’re going to be doing about how there’s some inspectors that are not even able to explain their own comments and their reports because AI wrote it for them. They gave them some prompts and AI wrote it, and they’re not even able to explain the prompt afterwards.

Joe Ferry
I’ll tell you, Brandon, who’s one of my associates, he is very good at detecting something that was written by AI, and I’ve actually seen this myself, where someone who’s one of my clients, will undertake a first response using AI, and I’m like, geez, this sounds so much like it was written by a robot, you know. Lawyers don’t really write like this, and my experience with AI is that I have used it, but you really got to be careful, like they give you cases and then you look for the case, and you can’t find the case, and you say to them, this case doesn’t exist, and AI says, oh yeah, you’re right, you got me, you know. I mean, they’re really unabashed about it, you know, and what I do now is I tell them, you know, give me a case that that addresses this so and so, you know, this fact pattern, and I say, and don’t make up a case like you did the last time I used you, you know, and I think that probably puts them on notice that you’re on to that kind of thing. I think what they’re good for is advice, and you know what I think they’re really good for, they’re good for planning trips, things like that. Like, do you say to them, hey, I’m going to Colorado next week. What are some places I should go look for? You know, what are some places that would be fun to see, good to photograph, or whatever, and they’re good for that, I think. But I still think that they haven’t quite gotten there yet, and if I were a home inspector, I’d be very wary of using them for comments, especially since, you know, there are guys that have been in the business forever, like I don’t know if you know Kenton Shepherd or not.

Ian Robertson
Oh, yeah, of course.

Joe Ferry
He wrote a whole book on these responses, and they’re tremendous. They’re really, really good responses, and I think home inspectors would be doing themselves a favor by staying away from AI, actually.

Ian Robertson
Yeah, and I mean, AI is going to be here, and it’s going to be used in the home inspection industry, unfortunately. I say, unfortunately, it’s kind of like a new power tool that came out, and people don’t use it properly.

Joe Ferry
Right.

Ian Robertson
It’s a great tool, like, improve the comment. I can’t clarify my thought, help me get this thought out there. It’s great for that.

Joe Ferry
I think it is good for that.

Ian Robertson
So there’s a home inspector that I know. First of all, I read a lot of home inspection reports, oh my gosh, like dozens a week, and they are progressively getting wordier and wordier and wordier. And then the clients are using AI to summarize these reports because it’s too wordy. And then between the inspectors’ original thought, the AI that wrote the comment out for him, the next AI that interprets it, and then the person reading the interpretation of the AI written comment, which was part of the original thought of the person. You get where I’m going.

Joe Ferry
Yeah, three generations.

Ian Robertson
Yeah, it’s like that game when you would whisper something in somebody’s ear and you go down 12 people. What was that called, phone line or something?

Joe Ferry
Whisper down the lane.

Ian Robertson
Whisper down the lane, yeah. So by the time it gets to the person, there’s a huge disconnect, and there have been inspectors that I know that, client says, hey, you said this in the report, and they’re just like, oh man, AI wrote that, what does that mean? And now, instead of being able to cleanly stand there, like Kenton can take any one of his thousands of comments, I think he’s up to like 7, 8, 9, 10,000 comments, can stand there and explain any one of them without looking, and he’ll just look dead in your eye and explain it.

Joe Ferry
I would absolutely endorse Ken Shepherd’s book, if anybody’s looking for an endorsement of narratives that you can use in your reports. One thing I wish home inspectors would do more of is when they find something that’s amiss, that they say, you need to have this professionally evaluated prior to closing, and that establishes what I call the killer defense, which is contributory negligence, and contributory negligence is, most of the lawyers on the other side of this, they think contributory negligence has been abolished, because they have a thing called comparative negligence now, but the problem that that establishes for them is that comparative negligence really only applies in cases where there’s property damage or there’s personal injury or death. That never happens on a home inspection. Home inspectors are not out damaging property. What these guys are claiming is that they failed to notice something, they failed to notice that the roof had a hole in it. They didn’t put the hole in the roof, that hole was there. But the home inspector pointed it out and said, hey, you should have this professionally evaluated, and if they don’t do that, they lose because of the contributory negligence doctrine. It’s a complete defense. 1% contributory negligence negates 100% on the other side, on the negligence of the defendant. So I don’t know why they don’t do that. I preach it at all my seminars that that is the killer defense. If you get that in there, there’s no recovery for the plaintiff in those cases. And lawyers on the other side are genuinely surprised to learn that, I mean, they just have no idea.

Ian Robertson
Yeah, I’m a big proponent of that as well. Like, hey, this is what I see and sense with my five senses. You need to get a plumber in here, you need to get a roofer in here. Yeah, and they didn’t do that. The first thing any judge or attorney or something is going to ask is, did you do the one step that they gave you to do? It’s kind of like saying, a doctor tells you, you know, eat less saturated fat for your cholesterol, then you go out and you have McDonald’s three times a day. It’s just like, but you didn’t do the one thing I told you to.

Joe Ferry
I’m old enough to remember Henny Youngman, king of the one liners. He used to say, guy goes to the doctor, he says, doc, it hurts when I do this. Doc says, don’t do that.

Ian Robertson
Yeah, exactly.

Joe Ferry
That’s something you don’t do.

Ian Robertson
Yeah, but going back to the AI thing, I guess this is all hypothetical, because there’s no, I couldn’t find any cases about it, but then again, maybe it was hallucinating, the AI that I was using. But in my mind, not being an attorney, I think if I were attacking a home inspector that used AI and it messed up my client, I would one, go after the standard of care first of all, and number two, I would use that as negligence. Like, the agreement says that I paid you for your professional opinion, and instead you gave me the professional opinion of an AI, and you’re not able to clearly explain your findings because, as you said in deposition, you used AI to write the comment, and the standard of care is the home inspector performs the inspection and then writes down their professional opinion. Do you think that would be something that creates that kind of liability for inspectors? I’m just wondering around the circles on it.

Joe Ferry
I think, theoretically, it might, but practically, like I said, you can’t try a case for under a million dollars, so for a case, I think the typical home inspection claim is probably worth less than $10,000. You know, they just can’t get there.

Ian Robertson
Small claims court.

Joe Ferry
Yeah, it’s a small claims court thing. And I’ve had clients—we have a small claims court tutorial that we give them when they get sued in small claims court—and they’re batting 1000. Now there haven’t been that many instances. There might be, maybe there’s been 30 people over the years that have gone to small claims court and defended themselves, and that’s, you know, batting 1000 is pretty good. The problem with small claims court is that they want you to settle, you know, you get in there, the first thing they want to do is go with the mediation. And mediation is by and large a loser for home inspectors, because, like I said, they’re generally not negligent, they generally have done the job, and so, you know, the guy’s claiming 5000, and the mediator gets the guy down to 2500, tells the home inspector that’s a home run. It’s a home run, yeah, it’s a home run for the plaintiff, because there’s no liability. So you’re better off trying those cases in small claims court, especially if you an agreement with limitation liability, or with an arbitration clause, especially with an arbitration clause, because they’re in the wrong forum. You know, judge will tell them, look, you’re in the wrong forum, you have to go into arbitration. And the thing is that these claimants, the guys that are telling them, you know, the home inspector should have found this, they’re not doing them any favor either, because it’s going to take over their life as well, and they’re going to end up being dissatisfied with the whole process, especially if they hear from me.

Ian Robertson
Yeah, exactly. Yeah, I’ve never, like, I follow some Reddit threads, and there’s people bashing home inspectors, and I’ve never seen anybody say, I happily sued somebody.

Joe Ferry
No.

Ian Robertson
It’s just like, I would never do that again. It was like going through a divorce, or you know, going through a hospital stay for six months, you know.

Joe Ferry
Yeah, you’re better off eating it, even as a claimant, I mean, here’s another thing, home inspectors should stop telling people the remaining life expectancy of a roof, you know, how do you know that, you don’t know that, you know. I don’t know how you would ascertain that, unless you were there when the guy installed a roof, and roofs, you know, depending on where they are, depending on what kind of weather you’ve had over the years, they can have life expectancies that are all over the map, you know, but most of these things, the way that these cases really come down is usually, generally, we’re not negligent. We follow the SOP, we did what we were supposed to do. And usually the claimant, he was negligent, he didn’t follow your advice. And then the third thing is they don’t have damages. A guy has a shingle fall off of his roof, he thinks he’s going to get a new roof. No, you don’t get a new roof, you get that thing repaired, that’s it. You get it repaired, it’s nothing. It’s not worth pursuing. And then there’s other defenses, such as there’s the economic loss doctrine. In a lot of states, there’s a thing known as the economic loss doctrine, where you cannot sue in in tort for a mere economic loss if you unless you were injured, unless the home inspector injured you, ran over you with his truck or something. There’s the economic loss doctrine. Then there’s the limitation of liability clauses, and then there’s the waiver of the statute of limitations, you know, like limitation for negligence in most jurisdictions is two years. If you by your contract, your agreement, you foreshorten that to one year, and they wait longer than a year, they’re out of luck, so they have a contractual loss there, and then you have the contributory negligence doctrine. I mean, it’s not hard to defend these cases, really isn’t.

Ian Robertson
It’s hard to sue a home inspector, and I always tell guys that, new guys that worry about it. There was, and I’ve told this story before, I worked for an agent or a broker who was an attorney, and his client was an attorney, and they both joked that they were going to sue me, and I laughed, and I said, go ahead and try, and they both laughed, they’re like, yeah, it’s near impossible to win a case against home inspectors, and we all just stood there laughing, because it’s just like, that’s why we hired you. You were a little bit more expensive. We just wanted a good inspector, knowing full well.

Joe Ferry
It’s really harder than winning as a doctor, too. You know, I mean, I actually, I’m one of the few attorneys I think that’s ever been on a jury, because they try to keep them off, you know. And I thought for sure I was going to be eliminated, but they kept me, and it was a medical malpractice case, and it was really a shame, a terrible case. These doctors took advantage of this woman, you know, all kinds of dopey tests. She was cancer free and they did a bone marrow thing on her. I mean, she’s cancer free. Why are you doing a bone marrow thing on her? That’s crazy, you know. But that really bumped up the damages, and that’s what attracted the plaintiff’s attorney. But we ended up returning a verdict in favor of the doctor. So, it was very interesting, though, to be a lawyer and to be in a jury box, to be in a jury room, because our first vote, there were 12 of us. In Pennsylvania, you only have to have 10 out of 12, 5/6ths, you don’t need an unanimous verdict, but on our first vote was 6/6. Like really? Yeah, six people thought that the doctor was liable. And then eventually we got to 10, eventually we got to 11, and there was one guy that just couldn’t, he just couldn’t see the light. But it was interesting for me, for jury dynamics, to see how it operates, how the sausage is made, you know.

Ian Robertson
Yeah, I don’t think that’s sausage I ever want to have. Yeah, I’m good.

Joe Ferry
You don’t want to have that sausage. Yeah.

Ian Robertson
Yeah, no, I’ve never been on a jury. I’ve almost ended up on a couple, but I’ve never been on them. But I learned a new term today from you, I always learn something new from you, but economic loss doctrine. I’m gonna do some research on that. I’m interested in that.

Joe Ferry
Yeah, research that. Yeah, if there’s not been an injury, then the economic loss doctrine prevents a tort lawsuit. Yeah, believe me, it’s new to you, it’s new to a lot of attorneys I tell about it.

Ian Robertson
Well, it’s funny because when the attorneys send their letters and they make demand letters, they make it sound, they take advantage of our ignorance, they make it sound like we have no case, yada yada yada. It’s kind of like the HVAC guy who comes and looks at your brand new heating unit and says your house is going to catch on fire, and if you don’t know any better, you just bought yourself a new heating unit, you know, but the attorneys do the same thing, like they’re not going to know about economic loss doctrine, they’re not going to know about arbitration clauses.

Joe Ferry
They’re not, and they don’t ask either.

Ian Robertson
Yeah, well, that’s us as home inspectors, I know about hydrostatic pressure, I don’t know about economic loss doctrine. We didn’t go to school to be an attorney. So stop and breathe. There’s a friend of mine who just got a letter.

Joe Ferry
Yeah, I think that your chances of having an adverse outcome is really remote, you know, if you follow what I’ve been saying and you’ve done your risk management. Yeah, risk management I think, is, you know, you do the best job you can do, and then you have an attorney that’s competent, and then you have an insurance company to back that up, and that’s all you can do. Once you do that, just go to bed at night and get your eight hours of sleep, because it’s not worth worrying about, and it really is not.

Ian Robertson
Yeah, you can’t fix it by worrying.

Joe Ferry
No, and I mean, the worst case scenario is you’re going to lose your deductible. There are worse things in the world. But what you want to do is you don’t want to have a lot of these claims. These claims have to be stopped, because, like, I said, 99% of these claims are ridiculous, and even though they’re ridiculous, the claims are being made, you’re eventually going to lose your insurance, and if you’re in a jurisdiction that requires you to have E&O insurance as a component of having a license, you’ve lost your mobility. You’re gonna have to move to a state that doesn’t do that, so you want to be able to stop these claims.

Ian Robertson
Yeah, I have another scenario for you. So social media has always been like this weird, squishy legal area, but a lot of home inspectors fight online about, they fight online about everything, but we all do, it’s what we do, right? We’re home inspectors. But one of the big arguments I see a lot is, you know, one home inspector posts a video of a defect they find in somebody’s house and they’re just slamming, they’re like, oh, you know, sellers this and sellers that, and they show the defect, and then other home inspectors will be like, how dare you post the inside of somebody’s house in a social media video, you’re going to get sued.

Joe Ferry
Right.

Ian Robertson
What are the legal repercussions of that, if any? Which side is right?

Joe Ferry
Well, I don’t know how you would defame a house.

Ian Robertson
Right?

Joe Ferry
I don’t think he can do that, but I can see people getting weird about something like that. Yeah, it’s probably not a good idea to do that, unless you have cropped the photo down to a point that it’s unrecognizable as belonging to any particular person.

Ian Robertson
I guess that’s the point, is making sure that it’s unrecognizable, like no family photos in the background, and stuff like that. But I’ve seen home inspectors go to the point of showing the outside of the house with the street address, you know, clearly seen on the front porch.

Joe Ferry
Yeah, that’s probably a bad idea.

Ian Robertson
They’ll show the contractors there, they’ll show this and that, and I’ve never seen them get in legal trouble, though. So, I mean, if I were a seller and somebody was posting it all online that I was trying to rip off a buyer, and maybe they didn’t, I wasn’t, you know, it’s like, would I sue? I have no idea, you know.

Joe Ferry
Yeah, I mean, there’s certainly no shortage of lawsuits in this nation, you know. But that’s actually a good thing, because otherwise you’re going to have vigilantes. Yeah, I mean, legal stuff, most home inspectors have a dim view of the legal system, but it actually, by and large, is does a pretty good job for most people.

Ian Robertson
Yeah, so basically, make sure if you’re making social media, anonymitize things, that’s the right word. What about, like, I’ve seen home inspectors put people in their videos, like, here’s example agent, and her name is this, and here’s a recording of what she told me over the phone or on site, or here’s a contractor, and those are a bit more edgy, and I’m not criticizing the people that do it, but…

Joe Ferry
Yeah, I think it’s a bad idea generally.

Ian Robertson
Is there a libel lawsuit in their future with that?

Joe Ferry
It could be, yeah, there could be. You’d have to know, you know, the specific facts of that. My wife and I, we were at the shore a couple years ago, and where we go is a pretty toney place in New Jersey, Spring Lake, New Jersey, and they were having a Halloween festival, and it was kids, you know, kids are out on the street and they’re dressed up, and so we’re taking pictures of these kids, because their costumes were really, were really cool, you know, on your phone, you know. I guess two brothers were there, they looked exactly like Mario and Luigi, you know, the Mario brothers, and other kids, you know. And this Karen, that’s the only thing I can describe her as, she comes up and she says, you can’t take pictures of these kids, and you have to explain to them, look, if you’re out in public, you can have your picture taken.

Ian Robertson
Yeah, outside your house is free game.

Joe Ferry
Yeah, yeah, right. But you know, we put our cameras away just to get rid of her, but people are just insane by and large, you know.

Ian Robertson
That’s going to be the quote for the episode. People are insane, by and large.

Joe Ferry
They just don’t get it, you know. The older you get, you realize how insane people are. But as far as social media is concerned, the less active you are on social media, the happier you’re going to be.

Ian Robertson
Yeah, take away the whole marketing advantage, I totally agree with you. The happier you’ll be, the less you doom scroll through.

Joe Ferry
Like engaging people politically is, that’s a loser, I think, because you know, I’ve done it myself, but you have to realize that you’re never going to convince anybody to your side, you know, they have to come to that conclusion themselves.

Ian Robertson
Yeah. Listen, Joe, we are at our time, but man, I loved…I could talk with you for hours here and just listen to your stories and stuff.

Joe Ferry
It’s great seeing you, where was it, Dallas I saw you?

Ian Robertson
I think Dallas was the last time we saw each other. Yeah, we were there with Mike Crow, and me and you and him were chatting around.

Joe Ferry
Right.

Ian Robertson
Did you ride the mechanical bull?

Joe Ferry
I did not, no.

Ian Robertson
Me neither.

Joe Ferry
But actually, what I did do was, my college roommate lives in Dallas, and we connected, we went to a place called Eataly in Dallas, and that was a lot of fun, and you know, we were college roommates. I actually met him when we were hitchhiking. We were both hitchhiking home from Notre Dame, and he got a ride, and I ran up and jumped in with him and another fellow. There were three of us, and I didn’t know him previously, and then we became roommates, so it was great seeing him. He was an infantry captain in Vietnam, and I was artillery lieutenant in Korea, so we were exchanging war stories.

Ian Robertson
Nice.

Joe Ferry
A lot of fun, a lot of fun.

Ian Robertson
You know, it’s funny, I met a guy at the bar, I was just sitting there, and I was just talking with a couple of inspectors, and there’s other guys in there, I thought it was inspector, so I said hi. Come to find out, he’s an eye doctor, and he was also meeting a college friend, yeah, and he’s like, I’m an eye doctor. I’m like, oh, so you work at the ICU?

Joe Ferry
I was at the bar there in that hotel, and I ran into Bob Pearson, who many people know, and I was astonished to find out that he had been in the Naval Academy. He went to the Naval Academy, and he left the Naval Academy because they wouldn’t let him be a pilot, and I had to leave. I had to not join the Air Force because they wouldn’t let me be a pilot, because I had astigmatism, and he had astigmatism, and it was a pretty interesting convo with him, guy I’ve known for years, and we’re the same age, and it’s interesting that we’re still at it, we’re still at it all these years later.

Ian Robertson
Well, I’m glad you’re still at it, because we got to have you on the show, we still get to benefit from your 40 plus years of home inspection extremely specific knowledge. And Joe, thank you for taking the time. I know you’re a busy guy, being on the show.

Joe Ferry
It was great. It was great. Yeah, I love your technology, even though you made me download Chrome.

Ian Robertson
Well, next time hopefully you won’t have to download Chrome to be on the show. But Joe, thank you very much, and we’ll talk soon.

Joe Ferry
Alright Ian.

Outro: On behalf of myself, Ian, and the entire ITB team, thank you for listening to this episode of Inspector Toolbelt Talk. We also love hearing your feedback, so please drop us a line at [email protected].

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*The views and opinions expressed in this podcast, and the guests on it, do not necessarily reflect the views and opinions of Inspector Toolbelt and its associates.

PODCAST SUMMARY/BLOG

Home inspector liability is usually fueled by fear, not facts. After thousands of home inspections, most professionals never see a courtroom, yet one demand letter can wreck your sleep. The real pattern behind home inspection claims is surprisingly ordinary: something fails months later, a contractor says “the inspector should’ve caught it,” and a buyer suddenly feels certain someone must pay. That “seed” turns a normal repair into a legal threat, even when the defect was seasonal, inaccessible, or outside the standard of care. Understanding that psychology is step one in home inspection risk management, because the story often matters more than the science of what broke.

The next surprise is how often E&O insurance behavior drives outcomes. Insurers and their panel counsel can be intensely risk-averse, sometimes paying to make a problem disappear even when a claim is defensible. Why? Litigation costs money fast, and many businesses would rather write a smaller check today than spend more on legal fees tomorrow. The industry also has accounting incentives around reserves and “incurred but not reported” loss estimates, which can make payouts feel disconnected from merit. For inspectors, the takeaway is not cynicism, it’s strategy: strong contracts, clean documentation, and smart early responses reduce the chance your file becomes an easy “pay it and close it” decision.

AI in home inspection is the new frontier, and it raises a practical question: if an AI tool writes a wrong statement in your inspection report, who carries the risk? The software vendor’s terms usually push liability back to the user, much like a power tool manufacturer isn’t responsible for how the tool is used. That means the inspector may be left defending accuracy, judgment, and professionalism while also explaining language they can’t fully justify. AI can hallucinate, fabricate citations, or produce confident-sounding nonsense, and that is poison in any dispute. If you use AI at all, use it for clarity and drafts, then verify every factual claim, shorten wordy narratives, and make sure you can explain each comment in plain English without hiding behind “the AI wrote it.”

Your best defense often starts inside the report itself. When you flag a defect and clearly recommend “professional evaluation prior to closing,” you create powerful leverage because the client has a duty to mitigate and follow advice. If they skip that next step, contributory negligence can become a complete defense in some jurisdictions, and even where comparative fault applies, it can severely reduce exposure. Pair that with core contract protections like a limitation of liability clause, an arbitration clause, and a shortened contractual limitations period, and many claims struggle to get traction. Add modern realities like the economic loss doctrine in certain states, and you see why many home inspection lawsuits don’t pencil out for plaintiff’s attorneys. Finally, be cautious with marketing: anonymize photos, avoid addresses, and think twice before posting people on social media, because privacy, defamation, and reputational claims are messier than posting a cropped defect photo.